Carillion to sell healthcare FM arm to Serco for £50m

Aaron Morby 4 years ago
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Crisis-hit Carillion has struck a deal with rival Serco to sell its healthcare facilities management business for £50m.

Carillion chief Keith Cochrane says latest deals with banks and pension fund will give indebted firm up to £190m headroom in 2018
Carillion chief Keith Cochrane says latest deals with banks and pension fund will give indebted firm up to £190m headroom in 2018

Under the heads of agreement Serco now has a few weeks to finalise the deal. 

The transfers of contracts are each subject to receipt of client consents, and, if required, shareholder approval. 

Contract transfers will then be phased with the aim of Carillion receiving the bulk of the proceeds during the first half of 2018.  

Keith Cochrane, Interim Chief Executive, said the firm has also negotiated a further loan facility of £140m on top of that secured last month from its five main banks.

He added that the disposal, new bank facility and deferral of pension contributions until January 2019 would give Carillion up to £190m headroom through 2018.

Carillion intends to dispose of its remaining contracts in its UK healthcare facilities management portfolio during 2018.

The group hopes to raise over £300m from further disposals by the end of 2018.

Cochrane added that while Carillion continued to pursue the disposal of its Canadian businesses, it was also evaluating whether a better result could be achieved by retaining some of the division.  

He said: “Today we are announcing progress on a number of fronts and while our customers and creditors continue to be supportive, much remains to be done. 

“We remain focused on executing our disposals and cost savings programmes while continuing our discussions with our lenders and other stakeholders to explore further ways of strengthening Carillion’s balance sheet.”

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